IN THE HIGH COURT OF KERALA AT ERNAKULAM
ST.Rev..No. 115 of 2010()
1. M/S.ICI INDIA LTD,KALOOR,CHAMMINI ROAD,
... Petitioner
Vs
1. STATE OF KERALA,REPRESENTED BY THE
... Respondent
For Petitioner :SRI.S.SANTHOSH KUMAR
For Respondent : No Appearance
The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR
The Hon'ble MR. Justice B.P.RAY
Dated :30/11/2010
O R D E R
C.N.RAMACHANDRAN NAIR &
BHABANI PRASAD RAY, JJ.
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S.T. Rev. No.115 of 2010
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Dated this the 30th day of November, 2010.
JUDGMENT
Ramachandran Nair, J.
The question raised is whether the Tribunal was justified in
confirming the assessment and demand of tax on the turnover of paint
mixing machines. We have heard counsel appearing for the petitioner
and Sri.Vinod Chandran, Special Government Pleader appearing for
the respondent.
2. The case of the petitioner is that the machines were given free
of cost to the dealers who are engaged in sale of petitioner’s products
namely, paint. Special Government Pleader by referring to documents
available in the assessment records submitted that petitioner has even
raised bills on dealers collecting the price for the machines. Further, in
the 50B certificate of account furnished petitioner has claimed
exemption of Rs.11 lakhs and odd towards value of machines supplied.
Counsel for the petitioner submitted that machines are supplied free of
cost to dealers under the agreement and ownership is retained by the
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Company.
3. After hearing both sides and after going through the orders of
the lower authorities, we feel the matter requires reconsideration with
reference to records, agreements and the records of the dealers which
the department is free to call for and verify. The mere fact that
petitioner has issued F Form for interstate stock transfer declaring the
purpose as “for resale” does not mean that tax could be levied if
machines are supplied by the Company to dealers by retaining
ownership with the Company. If Company retains ownership, then it
may be replacing machines or repairing it as and when the machine
becomes old or damaged. In the circumstances, we feel a detailed
enquiry is called for by verifying accounts of the petitioner and the
dealers, and by verifying the agreements. If there is misuse of F Form,
recourse open to the officer is not assessment or levy of tax. We,
therefore, dispose of the revision by remanding the matter to the
Assessing Officer after vacating the findings of the Tribunal and that of
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the first appellate authority for fresh consideration after giving
opportunity to the assessee.
C.N.RAMACHANDRAN NAIR
Judge
BHABANI PRASAD RAY
Judge
pms